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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: dpl who wrote (31158)	4/25/2005 2:13:15 PM
From: loantech	Respond to of 110194

Duplicate. EOM

To: dpl who wrote (31158)	4/25/2005 2:13:24 PM
From: loantech	Respond to of 110194

Bingo! You are correct or close to it.Just my 2 cents worth.

To: dpl who wrote (31158)	4/25/2005 2:57:02 PM
From: piggington	Read Replies (2) \| Respond to of 110194

>By the time you get the "hair brained ideas" the debt bubble will have been contracting for a while.The whole credit machine will seize up. I think this is the specific part where I'm having trouble. Can you tell me why this is necessarily true? Take my example of the "American Dream II Act." It's 2006, housing prices have declined, and a lot of people start defaulting. Yes, credit is contracting. So the gov't says, hey, everybody! We bought your mortgages from FNM/BAC/WFC/CFC etc and your rates are now only 3%! Also, feel free to miss the occasional payment or three. That would stop defaults in their tracks. Of course, people wouldn't overconsume like they do, and RE prices would still decline, and housing related jobs would decrease. Totally agree on that part - but doesn't the prevention of defaults (and btw the rampant printing) prevent deflation from taking hold? thanks for the insights, everyone... rich

To: dpl who wrote (31158)	4/25/2005 4:26:29 PM
From: mishedlo	Respond to of 110194

BINGO! Mish

To: dpl who wrote (31158)	4/25/2005 6:12:54 PM
From: patron_anejo_por_favor	Read Replies (1) \| Respond to of 110194

Very good point, it's not like the real estate market is liquid enough to be able to track (bubble implosion) with a high degree of precision. And the forces that take hold during a normal cyclical downturn will tend to mask it further, ie, sellers pulling homes off the market rather than accepting lower bids. Activity will be curtailed, but not much else will be seen....at first. It's not like the Nasdaq bubble, where prices dropped 30% in 3 weeks for all to see......